Insurance While politicians talk about universal health care and the high cost of insurance, the typical American is simply looking for a way to protect himself from the financial burden that accompanies major health problems. The emotional trauma of a serious accident or a debilitating disease is only compounded by the threat of bankruptcy when the bill comes around, but protection against every possible evil is very expensive. Some demographic groups can save a considerable amount of money by opting for what is called a major medical or catastrophic health insurance policy.
We’ve heard the criticism about insurance companies many times – they take your money every month, but then it’s hard to get anything from them when you file a claim. If you have a catastrophic health insurance plan, you may feel this way. Some plans have annual deductibles as high as $10,000. So if you incur an expense of $2,000 – which is nothing to sneeze at – you may feel neglected because your insurance company won’t reimburse you. However, it does protect you against the major medical calamities that can strike even the healthiest people at any time. In many ways, health care costs are rising quickly, and even a couple days in a hospital could cost tens of thousands of dollars.
Customers need to carefully consider all of their expectations before buying any insurance policy. The demographic groups that would most benefit from major medical coverage are the two extremes in age. Young people who are healthy, have no history of serious diseases in their family and are not yet ready to start a family would be the first group that should consider this option. The other group is older people who are not quite ready to enter the Medicare program but still have a healthy lifestyle and no preexisting medical conditions.
“You get what you pay for.” There’s a reason a 10-year-old car with 100,000 miles is cheaper than a brand new car – it’s not as good. Likewise, a catastrophic health insurance plan isn’t as “good” as a plan with a $250 deductible. People who have a long history of having health problems should avoid these plans. It’s OK to deplete your savings account one time in order to avoid a major catastrophe – but most can’t afford to pay $10,000 or more out of pocket every year. If your parents and grandparents have a long track record of health problems, then it would be better if you found a better plan.
The cost of catastrophic insurance can vary widely, but you could get a plan for as low as $40 a month. Often you’ll still have to pay 20 percent of the costs once you reach the deductible until you meet the total out of pocket expense. Both the deductible and out-of-pocket amounts can vary, but typically a catastrophic plan is considered to be one with both a high deductible and out-of-pocket expense.
It’s important to be as disciplined as possible if you have health insurance. Be aware that at any time something unexpected could happen – you may have to take a sudden trip to the emergency room, you may get a kidney stone, or you may incur some other medical problem. It’s not pleasant to think about this, but it’s important to be financially prepared. If you have a catastrophic health insurance plan with a deductible of $7,500 and a total out-of-pocket expense of about $10,000, then you may want to have a rainy day savings of at least $10,000. Many people suggest that you have an emergency savings account for about three to six months. This is especially important if you have a catastrophic health insurance plan. For more information, go to the top of the page and enter your zip code in order to get a free insurance quote.
Look at catastrophic health insurance site to find the best policy for you.
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